The Grants Issue

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A regular conversation in business finance is held regarding the availability and value of grants to
businesses made from various sources. Grant funding had traditionally been a very small part of a
funding matrix for private businesses, but then the COVID Pandemic reactionary lockdowns occurred,
and public-sector grant funding to businesses became a new norm for a period of time. The intention
from a public policy perspective was to support the private business community to remain whole
through the crisis so that normalcy could be reestablished at some future point. The businesses that
survived the Pandemic became, at least for a while, dependent on gift money rather than income
generation to continue operations. This very negative precedent has changed the perception of the
public sector as an enabler of prosperity for private enterprise.
It is not.
Training businesses to be dependent on public welfare rather than maintaining solid business practices
is a disastrous culture shift that has lingered in the economy well past its freshness expiration date. With
this in mind, a review of the grants landscape follows.

Free Money is Not Free
The basic definition of a grant is a one-way transfer of resources between the granting (agency) and the
recipient (business). In this respect, the money is free. However, there are offsets to the free money,
namely:

  • Grant Applications, Monitoring and Reporting. Considerable efforts, expenditures and energy go
    into the applications and related grants monitoring tasks. Many grant recipients are not ready to
    support the level of administration required under grant contracts to perform all the
    administrative tasks.
  • Opportunity Costs. The alternative to receiving grant monies oftentimes results in increased
    energy available to pursue for-profit activities that actually strengthen business operations.
    Scaling up and down, or the Yo-Yo effect. Hiring and training to perform grant activities, then
    firing productive employees when the free money expires does not usually produce a
    sustainable successful company.
  • Mission Creep. The pursuit of grant funds for the reason they are ‘free’ can cause a business to
    lose focus on the strategic development activities that are necessary to be performed in order to
    build resiliency in the business.
  • No Guarantee. Few grants are directed; most are competitive so the efforts spent in chasing
    grants don’t necessarily guarantee success. Oftentimes, the applications for funding exceed the
    grant funds’ abilities to fund, so many applications are not awarded funding.

Chasing grants only for their sake is not a viable long-term business model.

A Peek into the World of Grantsmanship


The overwhelming number and amount of grants are not directed at the private business sector as a
general rule. Most grant funds are directed to several broad areas, namely the public sector for
infrastructure and community-building projects, for social benefit and programming in a number of
areas which can fluctuate depending on the political culture at the moment, and for sustaining nonprofit
institutions for a number of causes and reasons. These grants are typically given out through
foundations, some of which are privately funded while others receive public funding in part or whole.
This area of grantsmanship is complex, and everchanging depending on the availability of current funds
levels, the purposes of the funding opportunities and the geographic locations where the funds might be
used in. Targeted funds for specific groups of people are included here, based on the recipients’
demographic characteristics.

More Common Grants for Private Businesses
This group of grants includes some that a business might want to pursue, while others might be applied
for as a result of misfortune.

  • Disaster Relief Grants. FEMA and the SBA are agencies which work in this space along with HUD
    and other State or Federal Agencies to a lesser extent. If you are pursuing a disaster relief grant
    it is because you have suffered a loss and there are few options available to you. This is not a
    positive event in a person’s or a business’s life.
  • Value-added Production Grants from the USDA. These are awarded on a competitive basis from
    the US Department of Agriculture to assist the formation and commercialization of products
    developed from ‘base’ agricultural products to raise the value of those crops.
  • Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) grants
    are awarded for pioneering work to develop and commercialize new technologies requested
    from a number of Federal Agencies. This area of free money can be the most complex and
    difficult to obtain, but can be a large sum of money to have in order to prototype and
    commercialize innovative ideas.

If You Want to Pursue Grant Opportunities

  • Read the NOFA (Notice of Funding Available) carefully
  • Develop a Compelling Needs Statement and Offer a Viable Solution
  • Obtain Letters of Support from Partners in the Affected Area That Will Benefit from the Grant
  • Address All of the Grant Requirements and Answer All of the Questions
  • Submit Your Proposal Within the Time Period Allowed
  • Consider Hiring a Seasoned Grant Writer, Especially if You are New to the World of Grants

Marshall Doak is the Director of the Southern Oregon University Small Business Development Center
and a supporter of innovation and the community that forms around innovation in the economy. In
private practice as owner of Managed Successions, LLC, he develops and manages projects for public
and private organizations for specific goal achievement success, including advising businesses wanting to transfer ownership and retain the value created over time. He can be reached through:
mdoak06@gmail.com or 541-646-4126.

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